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Archive for March 3rd, 2017

A Trump administration proposal to slash the budget of the beleaguered Internal Revenue Service by more than 14 percent next year has further heightened concerns that the new president’s spending and tax cut…

<p>Under the Trump presidency, politics and consumer goods are inextricably linked. Trump and his family are one with their respective brands. This has spawned protests like the #GrabYourWallet boycott, which urges consumers to avoid the Trump brand. And in this flurry, Ivanka Trump’s eponymous women’s wear line, has become one of the most controversial department store brands in recent memory.</p>

I’ve come across Kahneman’s Peak-End concept before but only just grasped it’s significance. As with much of his work Kahneman is highlighting an area where our minds don’t work rationally. In this case it’s how we remember experiences.

If we were rational we would remember experiences as some kind of average of how they felt at the time, adjusted for their duration. However, it turns out we remember them as a function of two moments – the peak moment (best or worst) and the last moment. Duration and average are less important.

Kahneman makes his point by citing research into how patients undergoing conscious surgery rated their experiences. Their post-surgery rating of the overall experience correlated with the peak moment of pain and how the surgery ended rather than the average of their minute by minute scores for how much pain they were suffering. Indeed, changes in the final moments of their operation dramatically skewed their overall perception of how well it had gone, in both directions.

This difference between how patients experienced their operations and how they remembered them exists with all experiences, both pleasant and unpleasant.

That has big implications for how startups should build products. Customers come back or tell their friends because of how they remember the experience of a product or a service, not because of how they experienced it at the time. Accordingly products should be engineered to deliver moments of delight and happy endings rather than maximum overall utility.

At Forward Partners we always look for those moments of delight, which we call “eyes-light-up moments”. Going forward I will be pushing us to pay equal attention to the closing moments of a customer experience.